Episode Details

The Internet was supposed to disrupt the middlemen. Yes, it created some peer-to-peer technology and services.

However, middlemen are doing better than ever. Uber and Airbnb, with their lack of hard assets, are quintessential middlemen.

In the travel world, Expedia, Priceline, Kayak, and Booking.com are also middlemen par excellence.

The Internet was supposed to level the playing field and disrupt monopolies. Today, Expedia and Priceline control 95% of the US Online Travel Agency (OTA) market. Just three travel companies (Amadeus, Sabre, and Travelport) own at least 90 percent of the Global Distribution Systems market share.

In 2010, Google bought ITA Software to create its flight booking engine. In 2014, it opened it up to small business and individuals to access. On April 10, 2018, however, Google closed off access to its QPX Express API service. This will shut out small companies from accessing its valuable travel data.

Meanwhile, private travel data kept on centralized servers have security risks. Last year, for example, Sabre was hacked.

Blockchain technology threatens to disrupt the travel industry.

Blockchain to the rescue?

Blockchain technology guarantees tight, immutable security. It also promises to do what the Internet failed to do: destroy the middleman.

Is the second time the charm? Or are the geeks crying wolf again?

What is Winding Tree?

Winding Tree is a nonprofit that aims to stir innovation in the travel industry by leveraging public Blockchain technology. It is creating a decentralized travel distribution network.

If their vision succeeds, travelers and travel service providers (e.g., hotels, airlines, tour guides) will split the billions of dollars that travel middlemen currently take. Translation: lower prices for the traveler and higher profits for the entities that actually deliver the service to the customer.

To facilitate this vision, Winding Tree raised money (Ethereum) via an Initial Coin Offering (ICO) that closed on February 14, 2018. Their token is called the Líf (pronounced “leaf”).

I interviewed Winding Tree’s CEO, Maksim Izmaylov, to learn more. We recorded this right before the ICO, but it's still relevant.

In the Q&A that follows, I paraphrase Izmaylov’s answers. (Izmaylov approved of the Q&A summary.)

Winding Tree's CEO, Maksim Izmaylov, and its CTO, Jakub Vysoký (right). Photo Credit: JULIA NOVICKAJA

Does the world really need another ICO? Why Líf? Why can’t Winding Tree just use a cryptocurrency like Ethereum, which already has smart contracts built into it?

Líf is more than a cryptocurrency. It’s a token that is based on the ERC827 token open standard, which we worked with Open Zeppelin to create.

Líf is optimized to carry travel-specific data. With Ethereum, it’s cumbersome to make a contract that says that you want a room for two single beds with a view and breakfast included. With Líf, it’s simple.

Also, bundling products are tricky w